U.S. Flat Panel TV Shipments to Decline for First Time Ever in 2012

Demand for flat-screen televisions in the U.S. is expected to decline for the first time ever this year, and continue falling for at least the next several years, according to a new report from IHS iSuppi.

Demand for flat-screen televisions in the U.S. is expected to decline for the first time ever this year, and continue falling for at least the next three years, according to a new report from IHS iSuppi.

The market research firm projected that shipments of flat-panel TVs to the American market will decrease 5 percent, or two million units, to 37.1 million units in 2012. In contrast, last year shipments inched up 1 percent to 39.1 million units from 38.6 million in 2010.

The research firm called the development a "decisive turning point." Shipments are expected to continue decreasing until at least 2015, when IHS expects 34.2 million units will be shipped to the U.S.

"The U.S. flat-panel television market has never declined on an annual basis, even at the height of the recession in 2008 and 2009," Lisa Hatamiya, TV research analyst for IHS, said in a statement. "The decline starting this year suggests that demand may have crested for the mature U.S. TV market."

Sales in the U.S. of flat-panel TVs — a category that includes LCD, plasma and rear-projection models — are now driven by consumers who are replacing their older flat-panel sets with new models, Hatamiya added. In developing regions of the world, however, there are still "vibrant, untapped markets" for buyers who have yet to purchase their first flat-panel TV.

Part of the issue is that television brands were too optimistic about TV sales in 2011, according to IHS. They increased flat-panel TV shipments in the first quarter of the year, but sales failed to pan-out as predicted.

Sets then had to be "aggressively priced" in the third and fourth quarters to make up for the meager sales during the first half of the year, IHS said. The price cuts hurt almost every vendor, and manufacturers will consequently attempt to control shipments to the U.S this year so prices remain steady.

"A silver cloud to the lining will be that despite the projected shipment decline, the industry as a whole expects to be more profitable, with less discounting bringing in more revenue," the research firm said.

About the Author

Angela has been a PCMag reporter since January 2012. Prior to joining the team, she worked as a reporter for SC Magazine, covering everything related to hackers and computer security. Angela has also written for The Northern Valley Suburbanite in New Jersey, The Dominion Post in West Virginia, and the Uniontown-Herald Standard in Pennsylvania. She ... See Full Bio

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